FAE September 2013

walshing wrote: »

but if valuing a company, we usual dont factor in the tax rate? do we? oh earnings after tax makes sense!

Yeah its just the institute solutions making it look more difficult

walshing wrote: »

but if valuing a company, we usual dont factor in the tax rate? do we? oh earnings after tax makes sense!

What's they multiple they give you? EBITDA etc...?

so_bored.com wrote: »

Noticed this earlier this morning aswel.. I took it to be the effect of tax!
If you calculate the earnings after tax(480) x pe of 8 it gives the same valuation?

Correct me if im wrong though?

That's also what I thought it was

so_bored.com wrote: »

Im actually confused now, should it not just the earnings before tax of 600 x pe multiple of 8 ?
The solution is basically taking the earnings after tax x pe multiple of 8?

Yes cos the formula for EPS is profit after tax/no of ord share in issue.

FoRMula for P/e IS mARKET PRICE of ord share/eps

Cross multiply P/E*EPS

Current P/E is 8


ie 480*8 = MV of shares
480 is also on page 4 of the question so you wouldn't even have to do the 600*80% thing anyway

CHARTEREDEXAMS wrote: »

Yes, I spent a few hours this morning going through it. Fairly difficult case overall in my opinion. Found it hard to identify and structure a response to alot of the indicators, especially the BL indicators, ended up cracking open the solution to see where to go.

Don't we all. Wish they gave us the grey box(say NA,NC,RC,C,HC) in the exam so we know what to write about.

General question to everyone. What is Kardex?

walshing wrote: »

mayflower mock 2013-anyone able to tell me when they valuing the subsidary they use 80%(600*80%*8)?( profit *pe*80%) where the 80% come out of?

That is a discount for the fact that it's not a listed company afaik.

kt22 wrote: »

Just wondering if someone can confirm the changes to audit core this year. Re ISA 260 and Re ISA 700,705, 706 and 720A. Are the changes just to the wording of the report or are there other changes I should be aware of?

Would appreciate this as well. As anyone looked at this?

Yeah not very much management in the cases - the old FAE Redbrick is good for ABC and some other topics - might revisit some old FAE papers

MoMo1987 wrote: »

Yeah not very much management in the cases - the old FAE Redbrick is good for ABC and some other topics - might revisit some old FAE papers

That's a good idea! Thank you

CHARTEREDEXAMS wrote: »

Yes, I spent a few hours this morning going through it. Fairly difficult case overall in my opinion. Found it hard to identify and structure a response to alot of the indicators, especially the BL indicators, ended up cracking open the solution to see where to go.

At one of the lecture days Paul Monaghan mentioned that the examiner for 2011 and 2012 is different than that in 2010. This could make 2011 and 2012 a bit more representative in terms of how the case is written and how the solutions are structured?

Did anyone do Swetter Gyms. wHAT did they mean by cancelling the shares

Also what's the story with the practising certificate in surf shop

ALos is a sharebuy back only for unquoted companies

Padkir wrote: »

I don't, but in general I found the audit elective book to be very good. Have that tabbed out to the last and every time I do an elective case I can more often than not find what I want from that book.

No I meant the compilation engagements in the technical handbook

What if the event arose that you were bang in the middle of the exam hall and you had to take a number two and there was only 10 minutes left of the exam and had one indicator left to complete that you felt strongly you had to get at least competent in it due to your poor answer in that area earlier.

You would have to do a cost benefit analysis. If you were to sacrifice the time and go to the toilet, it would probably cost you a year of your life to resit the exam with no guarantee that you were going to pass the following year either. Saying that, you would leave with a bit of dignity.

On the other hand, perhaps it would be best to have procedures in place and contingency/disaster recovery policies. It would be prudent to perhaps wear your least favourite trunks underneath your favourite lucky turtles ones you've had since you were 8 years old.

If the worst came to the worst, the repercussions would be as follows:
- get indicator completed; much better chance of passing exam and therefore save a year of pain in your life.
- financial gain from not having to pay exam fees again plus salary increase (provided not made redundant)
- lose any respect you ever had for yourself and no chance of hooking up with that hottie sitting behind you during the exam
- long term mental problems; perhaps might require the work of a specialist. This isn't a present obligation and may be seen as remote therefore no need to provide for this or disclose under IAS37.
- on the other hand, you could just pass it off as a bit of craic or blame someone else

It is also worth noting, VAT won't be claimable on the trunks that were ruined since not VAT registered. Come to think of it, you're not even a business.

Ethically speaking, it isn't very ethical at all to even consider not going to the toilet and especially blaming someone else. However, purely from a finanical point of view, it would make good sense. Overall, I would say the short term cost is outweighed by the long term gain.

Ron just brilliant...Love it...made me forget the exam worries for a while even tho the scenario was set in the exam..Such an enigma

Love it..what possessed you to think of that.

ANyway I think that's the way we are supposed to think in the exam

Lol2013 wrote: »

They are the employees

Thanks Lol could not for the life of me figure that out.

Really appreciate it